City Union Bank reports 11% increase in profit

PTI
Chennai |
Updated on
November 07, 2014
Published on
November 07, 2014

N. Kamakodi, MD and CEO, City Union Bank. BIJOY GHOSH

Says repayment of SMEs, agri loans has been good

City Union Bank has reported an 11-per cent increase in net profit to ₹193 crore for the second quarter as against ₹175 crore in the corresponding period last year. Revenue too increased by 11 per cent to ₹773 crore (₹697 crore).

The bank’s Chairman and Managing Director N Kamakodi attributed the better performance to the bank saying no to big-ticket lending of over ₹100 crore and focusing more on small- and medium-sized companies, a domain it is comfortable with.

“We are not concentrating on growth but on improving profitability,” he told newspersons.

It is usually said that when the economy is bad, the SME and agricultural sectors are the first to be hit, followed by large companies. However, in the bank’s case, it has been the reverse. Repayment by the SMEs and agricultural sectors has been good, he said.

The bank’s total deposits as on September 30, increased by 10 per cent to ₹23,152 crore (₹21,056 crore).

The bank reached a milestone during the quarter by reaching a business of ₹40,000 crore. It closed the September quarter with a 10-per cent increase to ₹40,060 crore (₹36,905 crore).

Advances

Advances saw a 7-per cent growth at ₹16,908 crore (₹15,849 crore).

Gross non-performing assets at the end of the second quarter stood at ₹337 crore, which is 2 per cent of the gross advances, he said.

As part of the Corporate Social Responsibility programme, the 110-year-old Kumbakonam-based bank, will provide a sum of ₹2.50 crore to set up 110 toilets in and around its hometown. It will provide ₹1.20 crore for purification of tanks in the town in view of the Mahamaham festival (celebrated every 12 years) in Kumbakonam. The festival is set for 2016, said Kamakodi.

On November 23, the bank will celebrate its foundation day in Chennai with R Gandhi, Deputy Governor, Reserve Bank of India and former RBI Governor C Rangarajan participating in the function, he said.